Islamabad, Dec 24: The Federal Board of Revenue (FBR) is considering a proposal to raise taxes on bank profits to cover a potential Rs. 550 billion shortfalls in revenue for December. This measure could generate an additional Rs. 100 billion in revenue.
According to officials, banks may receive concessions on their advance deposit ratios, either directed to the treasury or the private sector, as an incentive for accepting the higher tax burden. However, without this tax increase, it may be impossible to meet the revenue target. If approved, the proposal could be implemented within days. The FBR’s revenue shortfall for December is expected to reach Rs. 550 billion, adding to the Rs. 356 billion deficits from July to November.
The FBR has set a challenging target of collecting Rs. 1.4 trillion in December, but sources suggest this goal may not be achievable.
Earlier this month, the government also decided to introduce alternative fiscal measures to tax bank profits generated from investments in government securities. A high-level committee was formed to review the current legal framework related to the banking sector’s Advance to Deposit Ratio.
